Bitcoin braces for volatility-filled week with November CPI data release, Fed decision


  • Bitcoin price decline of nearly 4% precedes the upcoming November CPI data release. 
  • Core CPI year-on-year is expected to remain unchanged at 4% and headline CPI is expected to decline slightly to 3.1%.
  • BTC price could suffer further decline in the event of a higher than expected Core CPI reading.

Bitcoin is likely to experience heightened volatility this week with the upcoming release of November CPI data. BTC price suffered a correction of nearly 4% in the past 24 hours, ahead of the key macroeconomic events scheduled for the week.

Market participants are focused on US inflation data and the Federal Open Market Committee’s (FOMC) monetary policy announcement on Wednesday. 

Also read: Altcoin bull cycle 2023 picks by analyst: Ethereum, ChainLink, Arbitrum, Optimism

Bitcoin holders gear up for upcoming Fed data releases

The economic calendar is filled with macroeconomic data releases that could influence the Greenback and in turn, risk assets like Bitcoin and altcoins. The US CPI report for November, scheduled for release on Tuesday, followed by the FOMC meeting on Wednesday, are the two key events that could determine the direction of Bitcoin price trend. 

The consensus among experts is that the Federal Reserve is unlikely to raise interest rates at the December 13 meeting. A higher-than-expected inflation figure, however, may push up the chances of the Fed increasing interest rates at some point – or of keeping interest rates at current levels for longer – with implications for Bitcoin.

High interest rates have a negative impact on risk assets like Bitcoin. An increase in the chances of a hike, could therefore increase the pressure on BTC price and usher further correction in the asset’s price.

For there to be a material increase in the probabilities of rate hike the CPI would have to come out substantially higher. As things stand, the Core CPI YoY is expected to remain unchanged, at 4% and Headline CPI is expected to reduce by one percentage point, to 3.1% in November. These estimates would have to be roundly beaten to cause in a major shift in expectations of the trajectory of Fed policy, such that BTC would feel the impact. 

An upside surprise in the Core CPI reading, if substantial enough, however could impact Bitcoin price trend and push BTC price lower in the short term. In such a scenario,Bitcoin price could nosedive to support at $40,414, the upper boundary of an imbalance zone.

Once BTC reaches the $40,414 support level, however, it is likely to rebound, eyeing the 10-day Exponential Moving Average (EMA) at $42,311 as a target on its path to the December 8 top of $44,735, on Binance. 

BTC/USDT 1-day chart

BTC/USDT 1-day chart

In the event that Bitcoin sees a daily candlestick close below the psychological barrier at $40,000, the bullish thesis could be invalidated and BTC price could slip to the 50-day EMA at $37,435.

At the time of writing, Bitcoin price is $42,170 on Binance, down nearly 4% on the day.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended Content

Editors’ Picks

Is Altcoin Season here as Bitcoin reaches a new all-time high?

Is Altcoin Season here as Bitcoin reaches a new all-time high?

Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.

More Altcoin News
Shanghai court confirms legal recognition of crypto ownership

Shanghai court confirms legal recognition of crypto ownership

A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.

More Cryptocurrencies News
BTC hits an all-time high above $97,850, inches away from the $100K mark

BTC hits an all-time high above $97,850, inches away from the $100K mark

Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.

More Bitcoin News
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange

Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange

Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.

More Shiba Inu News
Bitcoin: New high of $100K or correction to $78K?

Bitcoin: New high of $100K or correction to $78K?

Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.

Read full analysis
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

BTC

ETH

XRP